Dear Reader, 

There is a lot of debate about whether credit cards are necessary or evil. I personally didn’t even attempt to get a credit card until my thirties! My mother told me that credit cards were from the devil and I believed her and that was that. Now, I have come to believe that they are necessary, but with the caveat of being very very careful. Credit cards can provide emergency funds, help you finance big purchases, and protect you from fraud. Not to mention that using them responsibly is also a great way to build credit.

Some people argue that credit cards are unnecessary because you can function without them. My debit card is good enough. Yes, that is true. However, a debit card does not build credit and the days of paying cash for everything (without your credit being run) are over. I believe that having at least one credit card in your wallet is a good idea. In the event of an emergency, it is always good to have access to funds. Additionally, if you want to automate bill payments, you never run the risk of overdraft. 

Of course, none of this matters if you do not use your credit card responsibly. Just like with anything else in life, moderation is key. You should only charge what you can afford to pay off and make sure to pay your bill every month. If you do this, using a credit card can be a great way to build your credit.

What are credit cards and how do they work?

Credit cards are a type of loan that allows you to borrow money up to a certain limit in order to purchase items or withdraw cash. You will need to repay the amount you have borrowed plus any interest and fees that may have accrued. The credit limit is determined by the card issuer, based on your credit history and income.

How can credit cards help me?

There are several ways that credit cards can be helpful:

• Emergency funds: Credit cards can provide you with emergency funds in case of unexpected expenses, such as a car repair or medical bill. BUT REMEMBER TO PAY IT BACK, PROMPTLY. 
• Finance big purchases: If you need to finance a large purchase, such as a new appliance or piece of furniture, a credit card can be a good option. You can often get a 0% APR promotional period, which means you won’t accrue any interest on the purchase if you pay it off within the specified time frame. REMEMBER, PAY IT BACK. It’s not free money. 

• Protection from fraud:  Much like a debit card, when you use a credit card, you are protected from fraud.  If your card is lost or stolen, you can report it to the issuer and they will cancel the card and issue you a new one. You will not be responsible for any unauthorized charges that are made to your account.

How can I use credit cards responsibly?

There are a few things you can do to make sure you are using your credit cards responsibly:

• Pay your bill in full and on time every month: This will help you avoid interest and late fees, and will also help you improve your credit score.
• Keep your balances low: It’s a good idea to keep your balances well below your credit limit. This shows lenders that you are a responsible borrower and helps you avoid paying high-interest rates.
• Use automatic payments: Setting up automatic payments can help you make sure your bill is paid on time every month.
• Monitor your statements: Keep an eye on your account balance and transactions so you can spot any fraudulent activity quickly.

Credit cards can be a helpful tool if used responsibly. They can provide emergency funds, help finance big purchases, and protect you from fraud. Just be sure to pay your bill in full and on time every month, keep your balances low, and monitor your statements closely. Doing so will help you avoid paying interest and fees, and will also help you build good credit.